Asian financial markets began the fourth quarter on a muted note on Thursday, with global bond yields hovering near multi-year highs.
Investors remained focused on persistent interest rate pressures despite a slower-than-expected rise in August US inflation.
A downward revision to July figures reduced expectations for an immediate Federal Reserve rate hike.
However, US Treasury yields climbed to fresh peaks overnight and held near those record levels during Asian trading hours.
Geopolitical tensions continued to weigh on global markets as stalled peace negotiations between the United States and Iran regarding the seven-month-long Middle East war hampered efforts to ease global inflation.
European economies felt significant pressure as prices in major euro zone countries rose faster than anticipated last month.
In equity markets, strong financial results from artificial intelligence chipmaker Micron Technology failed to boost overall market sentiment across Asia.
Trading volume remained thin as financial markets in Hong Kong and China were closed for a public holiday.
Micron projected quarterly revenue above market expectations and confirmed that customers expanded commitments under long-term supply agreements to $32 billion, pointing to sustained demand for AI memory chips.
In Japan, the quarterly Bank of Japan Tankan survey revealed that business confidence reached an eight-year high between July and September.
Elevated inflation expectations signaled stronger momentum for potential future borrowing cost increases.
A summary of opinions from the central bank's September meeting showed policymakers debating monetary policy after raising interest rates to a 31-year high.
Several officials expressed the need to accelerate monetary tightening or move borrowing costs closer to targeted levels sooner.
